The boss of the firm running one of Australia’s sole remaining fuel refineries says producing and selling petrol will one day become a “challenge”.

As the sales of petrol vehicles and the fuel they use trend downward, the CEO of a key Australian fuel refiner and retailer says it’s time to consider what happens when petrol production becomes unviable.

Data shows that as sales of hybrid and electric vehicles (EVs) have increased, sales of petrol at the bowser have trended down over the past five years.

Speaking to Alan Kohler on the That’s Business with Alan Kohler ABC podcast, Ampol CEO Matt Halliday said while EVs were still only a small portion of all cars on the road, petrol production could become financially unviable in Australia in the future.

“I think what I would point to is there is a structural shift that will happen over time. And that is refineries need to produce a proportion of… petrol or gasoline, diesel and jet [fuel],” Halliday said.

Rise of electric vehicle sales July 2020-June 2026

“And as you’re seeing more and more EVs and hybrids come into the system, you need to produce less petrol and more diesel and jet [fuel] … How you can navigate that transition requires investment and that imbalance needs to be managed over time.”

More hybrid and electric vehicles might not be the only reason fuel use is declining, with a report by the Australian Competition and Consumer Commission (ACCC) speculating last year that more freedom to work from home is another reason why people could be using less petrol.

Meanwhile, rural Australians are less likely to have the ability to work from home, and are more likely to own diesel vehicles.

Sales of diesel fuel have continued to rise in Australia, while petrol has slipped. Limited practical options currently exist for hybrid or electric versions of vehicles that have traditionally been diesel, and are required to cover long distances in rural areas.

Diesel is also heavily used in essential industrial, transport, and farming applications, making its future more secure than petrol.

Diesel and petrol fuel monthly sales to April 2026

Ampol’s CEO said it would be expensive to modify its refining facility in Queensland to prioritise producing diesel and jet fuel.

However, those modifications might be necessary as exporting petrol from its refinery in Queensland – if demand dried up domestically – would be “very, very expensive”.

“Part of what we need to contemplate is how we produce less petrol and more middle distillates or diesel and jet, but that’s expensive,” Halliday said.

“This would be, you know, how you set the refinery up for, say, [the] next 20 years? It’s billions of dollars, but we’re still doing the work on exactly what the numbers would look like, because we’re thinking longer term than we otherwise might have been.”

Domestic fuel production came under national scrutiny this year, after the outbreak of war in the Middle East threatened global oil supply.

Australia only has two operational oil refineries, which together produce around 20 per cent of Australia’s fuel needs. Ampol operates the Ampol Lytton Refinery in Brisbane, Queensland. Meanwhile, the Geelong Refinery in Victoria is owned by Viva Energy.

Even if petrol is less important for national fuel security, Halliday said diesel and jet fuel production will be necessary for the foreseeable future.

“The bigger challenge for Australia is in diesel and jet, where there is no real solution that is economic at the moment. So we’re going to need fuel security and fuel supply for a long time to come,” Halliday said.

Extracted in full from:  https://www.drive.com.au/news/petrols-days-are-numbered-says-key-australian-fuel-refinery-operator/

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